Dear All,
Suppose Mr. A, a proprietor, takes a mortgage loan against a house property of Rs. 1 Cr. Later this loan is utilized as under-
1. 20% is used to pay off home loan on which this mortgage loan is taken.
2. 50% is used to give loan to some other person.
3. 30% is used to incur other business expenses.
In this case, what should be the treatment of Loan and Interest on loan?
Can this loan and interest thereon be divided into business and personal category??
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Proprietor's business expense
Replies (2)
Yes u can claim only business related expenses only
yes you can appropriate interest paid towards 30% loan utilized for business purposes
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